Amazon referred to DOJ for potential criminal obstruction of Congress
- A bipartisan group of lawmakers on Wednesday sent a letter to the Justice Department, urging it to open an investigation into Amazon and its executives for potentially criminal obstruction of Congress.
- The group contends Amazon has "engaged in a pattern and practice of misleading conduct" in response to lawmakers' questions about its private-label practices and its collection of third-party seller data.
A House Committee is urging the Department of Justice to investigate Amazon over what lawmakers contend is potentially criminal obstruction of Congress.
In a letter sent Wednesday and addressed to Attorney General Merrick Garland, a bipartisan group of lawmakers alleged that Amazon repeatedly misled the House Judiciary Committee throughout a 16-month probe into the competitive practices of Amazon, Apple, Google and Facebook.
In particular, lawmakers have zeroed in on Amazon's private-label practices and its collection of third-party seller data. Lawmakers claim Amazon has made false and misleading statements to the House Committee about its practices, then refused to turn over evidence that would "either corroborate its claims or correct the record," according to the 24-page letter.
"It appears to have done so to conceal the truth about its use of third-party sellers' data to advantage its private-label business and its preferencing of private-label products in search results — subjects of the Committee's investigation," according to the letter, which was signed by Judiciary Committee Chairman Jerrold Nadler, D-N.Y., House Antitrust Subcommittee chair David Cicilline, D-R.I., and committee members Reps. Ken Buck, R-Colo., Matt Gaetz, R-Fla., and Pramila Jayapal, D-Wash.
"As a result, we have no choice but to refer this matter to the Department of Justice to investigate whether Amazon and its executives obstructed Congress in violation of applicable federal law," the letter continued.
An Amazon spokesperson told CNBC in a statement: "There's no factual basis for this, as demonstrated in the huge volume of information we've provided over several years of good faith cooperation with this investigation."
Amazon executives defended the company's business practices in a series of hearings during the investigation. An Amazon official testified in July 2019 that the company does not use individual seller data to inform its strategy but maintained that it does use aggregated data.
During testimony in July 2020, Amazon founder and then-CEO Jeff Bezos said the company has a policy that safeguards seller data from employee access, but he couldn't guarantee the policy had never been violated.
Lawmakers pointed to "credible investigative reporting" from Reuters, The Markup, The Wall Street Journal and others that directly contradicts testimony from Bezos and other Amazon executives. The committee's investigation found similar evidence from former Amazon employees, as well as current and former sellers, according to the letter.
They said as the committee continued their investigation, "Amazon attempted to cover up its lie by offering ever-shifting explanations" of its seller data policy. Then, the company "stonewalled" attempts to glean more information about Amazon's business practices.
"For this, it must be held accountable," the lawmakers wrote in the letter.
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